British Universities are on the brink of a period of accelerated growth, driven by domestic and overseas, (Chinese especially), demographics. Over at Toscafund, my old colleague Dr Savvas Savouri and his research team have authored a piece on University growth which ought to have Vice Chancellors, Local Authority planners, developers and indeed investors thinking hard about it's implications. Westminster will as usual be last and late to the party but we can but prod them into some form of animated sentience rather than their usual reaction at the last moment usually that of a stunned halibut.
The executive summary is below followed by the full piece, (published with the authors permission). It is a very interesting read. It is positive and it is good news. Why isn't anyone telling the nation when we get things right?
"Within a handful of years UK university enrolment will begin to move sharply higher. It is only a matter of time before two-year undergraduate degree become commonplace, doing so in response to practical and commercial considerations for students, universities and tax-payers alike. Moving from three to two-year courses eases the overall cost burden on students whilst allowing universities to more intensely work their assets. For even with overall enrolment constant, universities could use accelerated degrees to shift the student mix towards those paying more lucrative fees. They could for instance increase the share of postgraduates and/or undergraduates paying 'premium' fees, notably those from outside the EU, and in particular those applying from China.
Using a combination of demographic and macro-economic data from within China since 2002, we predict that in 2025 there will be in the region of 117,000 applications from China into the UK’s higher education sector, increasing to 239,000 by 2034. For context the most recent figure for 2016/17 was 66,415. By 2034 there will be over half a million Chinese studying in UK-based universities, representing over half of all international students. For context the present share is just over one in five. Whilst other nations around the world will compete with the UK in meeting China’s educational needs, nowhere across Europe will come close to matching the UK’s role.
As a result of the rise in births post-2002 as well as other socio-economic factors the number of Britons enrolling at its universities is likely to reach 2.4 million by 2034, up 29% from the 1.9 million studying in2016/17.
The region which will experience the largest rise in student numbers is expected to be Southeast, whilst theEast midlands will enjoy the strongest percentage growth. Scotland and London are expected to lag most in capitalising on international student demand, albeit for quite different reasons.
When raising their capacity few industries have as voracious an appetite to consume real estate as education. It is for this reason that universities which have little space to expand around their existing campuses will have no other option than to find room elsewhere across the United Kingdom. They will take-up and regenerate existing real estate as well as creating new space on hitherto undeveloped ground, quite possibly traditional agricultural land.
We anticipate that employment across the UK’s universities will rise 30% to over half a million by 2034, the sharpest increases being recorded in the South East (beyond London), North West (around what is fast becoming Man-Pool) and Midlands (containing as it does a great many city-centre and campus universities), with the weakest increases in Northern Ireland, Wales and Scotland (because of its “outlier” approach to student funding). Growth in staffing and increased need for real estate will of course correlate strongly with where the increase in student numbers is comparatively strongest. This will in turn be closely connected to the rise in freshers coming from China. We estimate employment across the overall education sector willincrease by 830,000 reaching 3.9 million by 2034, section 1.16.
As overseas demand for their courses increases the names of British Universities will become metonyms for international campuses; a process in fact already underway. Some will also add a virtual presence to offer distance learning, again something which has already been seen, This accepted, and to repeat, the names of UK universities will ever more perceptively adorn campuses, teaching in the traditional way and away from their traditional centres, but still somewhere in the UK. Having seen this phenomenon come to London, “satellite” London brands will soon be seen beyond it. We are in short about to see the writing of an entirely new chapter to Britain’s regional real estate growth story, and a very educated one it will be at that."
Mr Cameron has done a good thing in fulfilling his promise and offering us a straight answer in-or-out referendum on Europe. While I don't agree with his personal view, I respect him as a man and a politician for having the courage to face down what has been a corrosive issue in British politics for a generation. Some would say it has been corrosive for Britain but then we have the referendum to settle the issue. He at least has done what none of his predecessors had the confidence to do.
Westminster and the media are loving the whole thing. They relish plots, intrigue, alliances, broken loyalties, subterfuge and everything else that goes hand in hand with the self feeding circus they live off. After all, this is why they all did PPE at Oxford and this is their moment. Well, actually... sorry to rain on your parade boys and girls but it isn't. The rest of us have been waiting an awfully long time to make ourselves heard and I suspect the sound is going to rattle and reverberate across the world on June 24th at a level that will spin the needle off the clock. My view, for what it is worth, is that the leave vote will overwhelm those who wish to keep the status quo by a margin which Westminster, and the EU, are simply not prepared for.
We have already heard many short sound-bite arguments from both sides, usually in less than 140 characters. Much of what is said is simply made up and has no basis in fact. The principle tactic employed by both sides appears to be one of who can scare us the most. Well it won't wash. In the voting booth most citizens will disregard all the hysteria that has been pumped out and will simply apply their own reasonableness test based on their own experience of family and community around them. No nation on earth is better equipped to be reasonable, it is what we are. That gives me confidence.
Nonetheless, in a modest contribution to the discussion allow me to share an illuminating discussion paper on Brexit written by former colleague Dr Savvas Savouri of Toscafund, in which he deconstructs some of the more alarmist claims being banded around the television studios by the Hampstead and Notting Hill crowd. It is worth taking the time to read.